Fleet Management

Independent Contractor Bill Signed into Law in New York

New York Gov. Andrew Cuomo has signed into law the New York State Commercial Goods Transportation Industry Fair Play Act, drastically changing how the state classifies independent contractors, yet it has the backing from two groups that rarely agree on anything, fleets and organized labor.

It amends state law, creating a presumption that any person performing commercial goods transportation services for a commercial goods transportation contractor shall be classified as an employee, unless the individual satisfies the stringent independent contractor or separate business entity tests set forth in the new law, according to JD Supra Business Advisor.

Orginally, the bill called for it apply to truckers who drive rigs weighing more than 26,000 pounds, but in signing it Cuomo reportedly dropped to level to those who drive trucks weighting more than 10,000 pounds.

The final legislation received the support of the New York State Motor Truck Association who said it does not endanger using the owner-operator business model that some trucking companies use. The new law also has the support of the Teamsters Union.

Passage followed a study that found in New York State, nearly 40,000 employers misclassified more than 700,000 workers, with misclassification disproportionately higher in the trucking industry.

Read more, including details on who is covered, the indepdendent contractor test, penalties that apply and more from JD Supra.